Sirius XM may be filing for bankruptcy soon. Even with big stars like Howard Stern, the company still does not seem to have been making a profit. The company is knee-deep in $3.25 billion in debt.

It’s still unclear how the bankruptcy will effect the company’s millions of customers. Jointly associated is the troubled auto industry because vehicles are sold with Sirius XM radios installed. This application accounts for the company’s largest customer base among Sirius XM’s 20 million subscribers.

With the debt seeming like it cannot be paid off, the company may be bought out by Echostar. However, the CEOs of the two companies are said to not get along very well. In addition to the $175 million due in February, EchoStar also owns $400 million of Sirius XM’s debt due in December. If Sirius XM files for bankruptcy, EchoStar could seek to take over the company through the courts.

I’ve got a gut feeling that satellite radio may go sooner or later. Why? Because it never seemed like it was tremendously popular. Sure, lots of consumers may have satellite radio in their cars, but can we compare that to the number of people that listen to the music off their iPod instead? I’m positive there are lots more people that listen to their MP3 devices in their car over radio of any sort. Hence, this has been the major problem with lots of radio stations.

Having experience as a college radio station President, so I know about the hardships of getting people to listen to you. It’s been a slow movements amongst colleges, but more and more they are integrating web video into their priorities in order to keep their audience entertained. Perhaps if Sirius XM also designed a platform that would allow streaming of their content and also display video of their content it may take an extra jump. Maybe then all the Howard Stern fans and Maxim radio fans that never crossed over the satellite would possibly make the jump.

Additionally, satellite radio stations came to the iPhone recently. (There are no statistics yet on how many people have been using it.) However, targeting the mobile network could be a great idea. Additionally, how about targeting the laptop network? It’d be nice to listen to have the option to listen to Sirius radio stations over internet radio stations like Pandora and Slacker. Despite my personal love of the latter two, if something better could come creeping up it may just win over more converts.

Reader Comments

IMHO, the reason satellite radio is destined to fail is that it has nothing of substance to offer. Commercial free music – as Chris pointed out – use your iPod. Your favorite tunes, no commercials.

As for news, the primary stations that cater to the spoken word – Talk Radio – are freely available up and down both the FM/AM dial. All that satellite had was trash talking ‘shock-jocks’. The market spoke, and capitalism is working. There is simply no demand for a ‘shock-jock’, no matter how much you hype him, no matter how much you pay him … people just don’t want to PAY to listen.

Lastly, I can (and do) listen to talk radio all day, every day, at work. There is no offensive language, no derogatory assault upon any ethnic group. Various ideas are expressed, and referenced against sources. You can hear these stations almost anywhere. The same cannot be said about many of the satellite stations. The public voted, and they voted with their wallet.

http://www.livinggeek.com Greg Stone

The only thing that could save SiriusXM now is for the Fairness Doctrine to come back. The FCC hounding of Stern chased him off the public airwaves and onto Sirius. The only guy left with the audience share of Howard is Limbaugh. If the fairness doctrine returns he may say screw it and go to Sirius with a percentage of his audience. If enough of the other big-ish names make the leap that may bring enough customers over.
It’s a long shot wrapped up in a pipe dream and it would actually mean things would have to get bad for most of us to get better for SiriusXM, but that is the only way I see them every turning a profit.

JiggilyJoe

I’ve had xm for about 2 yrs now and for the most part I really like the lack of commercials. But as for loading up my ipod, I guess that works, but it seems like I usually end up listening to the same music over and over, or listen to a hard rock song, then it always seems like it is followed up by something that has a totally different flavor, that I added “because it was a good song”. Sure it’s a good song, but it just didnt fit with what I was listening too…. Maybe I just bite at building play lists, but with XM I don’t have to. I just choose a station with the type of music I want and its all good.
I used to use Windows Media center to listen to xm through my PC and my XBox, but they don’t support it anymore. But I got a notice from XM the other day that they will be changing their online radio to a digital format that would no longer be free, but instead part of a “new package”.
Hopefully it will still be around for awhile because I really like the service, but I have to admit, the constant worry of changing rates and other things are starting to get a little old.

BolthouseJuiceIsGreat

People like to have opinions of things they have never tried or learned much about. I have been an XM subscriber for three years and only began using it as gift. It took a bit of searching to find all the service offers, but now I wouldn’t dare think of using any other device in my car. I have a huge amount of music on my ipod and also bring it on the road to play in the car with me…but, you know what? I always end up turning on XM instead. In fact, my XM Radio has helped turned me on to numerous artists and even genres that I didn’t know I was interested in. I’m much more in tune with the latest music and I can switch between music, talk, news, and traffic in an instant. I certainly hope more individuals would give the service a real shot and not just look at it as a passing gadget or gimmick. I’m cheap and I believe satellite radio delivers a supreme value for my dollar.

ianoid

The idea that nobody wants to listen to “shock jocks” (Howard Stern, as you so carefully avoided mentioning like he’s the name of the beast), is just plain wrong. Stern is still very popular. He has millions of listeners on Satellite. I have been a satellite/Stern listener in the past, but switched over to listening to podcasts. If I could download a few hours of Stern on iTunes each week for a few dollars, I would.
Satellite is great for truckers and big time commuters. They have a ton of content that isn’t just Stern, there is something for everything, including you neo-conservatives and whatever. Satellite is also great for stores interested in commercial free music.
I wouldn’t worry so much about them increasing rates, they have to remain competitive. It’s too bad they haven’t been able to control costs sufficiently and remain a lean industry. I would hate to see an outlet for free speech squandered.

lonegunmen

re: Hodar
“IMHO, the reason satellite radio is destined to fail is that it has nothing of substance to offer.”
You couldn’t be more wrong. Satellite radio offers a wide range of channels to listen too, that you cannot get on your Ipod or through local radio. Satellite radio lets you listen to a variety of music that you simply wouldn’t have discovered on an Ipod. I’ve found alot of music throught satellite radio that is not played by local stations. With a Ipod you have to know already the bands and songs you like, then download then, then make a playlist, and organize your files. With satellite radio, you can easily discover new bands and songs, listen to CNN live for news, Talk Radio without static, live concerts, the entire MLB games etc. Too much to list. Ipod lets you listen to the same stuff over and over again. Some talk radio is on the AM dial, which can be a pain to dial-in too and contain plenty of static. With satellite radio, no static, you go right to the channel, and can travel pretty much everywhere and listen to the same channel. Local radio often has DJ’s that talk blah, blah, blah, and then never play the song that they promised to play. Local radio contains commerical after commerical, more than music. For less than the price of one music CD per month, you get access to a truck-load of music and content. For the same price, you could only purchase about 10-12 music tracks off of Itunes. I personally don’t care for shock-jocks, but alot of people do like them. How do you think Howard got so popular to begin with? I think the reason satellite radio is having trouble is because, 1. it’s expensive to launch satellites, 2. alot of people are sheep and will buy an Ipod no matter how good other players or sources are, just because their friends have one,. 3. the economy is having a tough time, so some people are going to drop things like satellite radio. 4. some people are stupid and think that local radio will provide the same content as satellite radio and won’t bother to look into it any further. Just my two cents…

Fair Play

I’m actually a fan of Sirius radio! I like choosing a genre and getting exactly what I want without commercials every couple of songs. While I do plug my iPod in a good chunk of the time, I’m still limited to what I have on my device versus FM or Satellite radio that offers me a much wider variety of music to choose from. Radio (traditional or satellite) also gives me the chance to hear new music so I know what to purchase next.
The biggest downside for me is the added cost. The monthly rate for Satellite (IMO) is still too expensive for what you get. Rate plans in Canada are still about $15 a month plus tax (unless you lock-in to a 1, 2 or 3 year contract). For $10 a month I can have unlimited music off of subscription services like Napster.
Until they get their pricing aligned I don’t see any feasible way for Satellite to compete.